No. First, never short on valuation alone and there is no imminent catalyst here. Second, remember Bob Wilson: 'I don't short manana stocks,' meaning stocks that trade on hopes and dreams (and when he did he almost blew up). If the bull and bear case were well established and you had evidence that the bullish narrative was breaking, then perhaps it could be worth a look. Besides, this market is flush with liquidity and exuberant retail traders: shorting generally, and smaller/growthier names in particular, seems treacherous until the market regime changes. Lastly, I actually like the underlying product. If I had to short, I'd look for targets where the underlying business is clearly broken and economic reality will eventually catch up with the stock.
Hi Neckar, did you consider shorting these poor fellas?
No. First, never short on valuation alone and there is no imminent catalyst here. Second, remember Bob Wilson: 'I don't short manana stocks,' meaning stocks that trade on hopes and dreams (and when he did he almost blew up). If the bull and bear case were well established and you had evidence that the bullish narrative was breaking, then perhaps it could be worth a look. Besides, this market is flush with liquidity and exuberant retail traders: shorting generally, and smaller/growthier names in particular, seems treacherous until the market regime changes. Lastly, I actually like the underlying product. If I had to short, I'd look for targets where the underlying business is clearly broken and economic reality will eventually catch up with the stock.
Lovely post!